San Francisco — With the recent patent fracas erupted between Yahoo and Facebook, the social networking humongous in an attempt to further safeguard itself from such litigious competitors, the company has acquired a large collection of patents chest held by an old technology giant, IBM, according to Bloomberg reported Thursday.
According to a fresh report quoting an anonymous source, Bloomberg reported that Facebook Inc. has acquired 750 patents from IBM, as the social media company attempts to bolster its intellectual property portfolio in the wake of a lawsuit filed by Yahoo, a person with knowledge of the matter said.
An IBM spokesperson refused to comment on or confirm the report. A Facebook spokesman confirmed on Thursday afternoon that it had bought a huge collection of software and networking technology patents, but would not comment on the volume or specifics of the patent collection. Though Bloomberg later reported that Facebook had purchased 750 patents.
The 750 patents from IBM covers a wide range of technologies such as software and networking, said the person, who asked not to be identified because the deal has not been made public.
Besides, in comparison to other tech firms, Facebook’s arsenal of patents is pretty meager: The company had 56 issued patents and 503 applications as of December 31, the company said in a recent filing with the U.S. Securities and Exchange Commission, as compared to the thousands stockpiled by the likes of Microsoft and Apple.
Facebook, the world’s biggest social-networking service, is beefing up its legal arsenal amid a standoff with rivals that have broader intellectual property portfolios. Its forthcoming public stock offering makes the social media behemoth, a perfect target for patent fights.
This latest acquisition pact comes at a time when Facebook is under attack from Web giant Yahoo, which last week sued the popular social media giant, claiming that the company has infringed on 10 patents, that suit argues that Facebook embezzled some of Yahoo’s patented technologies, specifically ones that cover customization and online advertising technology.
“We are currently, and expect to be in the future, party to patent lawsuits and other intellectual property rights allegations that are expensive and time consuming, and, if resolved adversely, could have a significant impact on our business, financial condition or results of operations,” it declared in its application for a public offering in February.
In fact, this latest patent grab would certainly swell the size of Facebook’s intellectual portfolio. Also, Facebook may have doled out hundreds of millions of dollars for the IBM patents, said Erin- Michael Gill, a managing director at MDB Capital Group LLC.
“This is a very big deal,” said Gill, who is chief intellectual property officer at MDB, an investment bank focused on intellectual property. While it is unclear how strong the patents are, “Facebook is now where it’s supposed to be.”
Patents now play an increasingly significant role in the development of new technologies on the Web and for consumer electronics. However, it is unclear how much Facebook paid for the IBM patents, but tech companies seeking to build their portfolios have pushed intellectual property prices higher. Besides, IBM has been pretty cordial in selling patents to younger tech companies in the past. In January, Google bought 217 patents from the IBM, including one for a “semantic social network.”
IBM’s transaction with Facebook was first reported by Bloomberg.